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problem1: Which of the following reasons causes bonds to be a less expensive form of capital for a public firm than the issuance of common stock? 

[A] Receive greater returns than common stockholders.

[B] Do not have a contractual claim on the firm.

[C] Bear less risk than common stockholders.

[D] Have prior voting rights over common stockholders.

problem2: The debt ratio is a measure of a firm’s:

[A] Liquidity

[B] Efficiency

[C] Leverage

[D] Profitability

problem3: Style Corp. preferred stock pays dollar 3.15. What is the value of the stock if your required rate of return is 8.5 percent rounded to the nearest $1?

[A] $27

[B] $37

[C] $33

[D] $23

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M920710

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